PA Resources, an aluminium extruder, has announced its acquisition of two industrial lands in Kuala Selangor. The purpose behind this acquisition, totalling RM21 million, is to construct a new factory, thereby expanding its production capacity. Malaysia-based PA Resources is an aluminium extruder engaged in fabrication and related services.
According to a filing submitted to Bursa Malaysia on Monday, PA Resources disclosed that its wholly-owned subsidiary, PA Extrusion (M) Sdn Bhd, has finalised two sales and purchase agreements with Niken Steel (M) Sdn Bhd. These agreements entail the acquisition of two vacant leasehold plots spanning a combined area of 72,840 square feet.
About the acquisition
Notably, the leases for both parcels are set to expire on January 23, 2096. PA Resources has emphasised that the proposed acquisition aligns with the group's expansion strategy, driven by the nearing total capacity of its nearby factory.
To address this limitation, the company plans to establish a new factory. It is anticipated that this new facility will significantly bolster the production capacity of PA Resources, increasing it gradually from 3,200 tonnes per month to 7,000 tonnes per month over phases of development. PA Resources has disclosed its intention to procure financing from financial institutions to cover up to 80 per cent of the total purchase price of RM21 million. The remaining 20 per cent will be funded through internal resources.
On Monday, PA Resources' shares concluded trading 0.5 sen higher or up by 1.39 per cent, settling at 36.5 sen. This performance translates to a market capitalisation of RM545.15 million. Notably, since the beginning of the year, the counter has surged by 35.19 per cent, rising from 27 per cent.
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